Tasmania's Labor-Green minority government maintains its stability will not be compromised by the rejection of a bid to add large swathes of the Tarkine region to the National Heritage list.

The Federal Government has decided not to adopt a recommendation from the National Heritage Council to protect 439,000 hectares of the mineral-rich area in the north-west.

Instead just a narrow 21,000 hectare strip of coastline will be protected for its Aboriginal heritage.

The Federal Environment Minister, Tony Burke, says the decision was the toughest of his career on a personal level, but he could not sign-off on the Heritage Council's full request.

"Had I put that into place, in my view, the economic consequences for Tasmania would have been diabolical at a time when Tasmania absolutely doesn't need that," the Minister said.

The Premier Lara Giddings believes the decision will lead to the creation of more than 1,000 jobs in the north-west region, where the unemployment rate is almost eight per cent.

"What this means is that any arguments that Tasmania is closed for business are now dead in the water.

"This is a great day for Tasmania, a great day for jobs," said Ms Giddings.

Several mining projects are planned for the Tarkine, including a tin and magnetite mine at Mount Lindsay being developed by West Australian company Venture Minerals.

Lara Giddings says that project is now a step closer.

"We hope to see projects like Mount Lindsay now have the confidence to really get underway, and create 1,000 jobs through the construction process," she said.

The Acting Greens leader Tim Morris believes the Premier's estimate is ambitious, and the number of long-term jobs will be much lower.

"It might be 1,000 jobs for a very short period of time, but I don't believe that until I see it, and I seriously suspect she's overstating the case dramatically," he said.

'No rift'

The decision has the potential to place further strain on the Labor-Greens minority government, despite the creation of mining jobs.

While Labor supports the decision, Greens Cabinet Ministers Nick McKim and Cassy O'Connor have been vocal advocates for the protection of the Tarkine, which includes tracts of temperate rainforest and populations of Tasmanian devils free of the facial tumour disease.

But neither party is buying into talk of a damaging split.

"Nick McKim and myself have been very consistent on this issue, which we disagree on," said Lara Giddings.

The acting Greens leader Tim Morris is also confident the issue will not cause a rift.

"They knew when we formed a partnership with Labor, when Nick and Cassy went in as ministers that we were campaigning for the protection of the Tarkine.

"That campaign continues, so I suspect that the relationship will continue," said Mr Morris.

Free trade is the oldest argument in federal politics and the issue that literally defined the federation era but opposition exists to the TPP, courtesy of the Investor-State Dispute Resolutions clause.